Dismissed

Protochem Laboratories Pvt. Ltd. v. Official Liquidator of M/S. Glass Carboys and Pressed Wares Ltd. (in Liqn) and 2 Ors.

Bombay HC9 Aug 2007APP/363/2007

Case brief

AI extract

What is this about?

This appeal challenged a Company Judge's order directing fresh property valuation during a liquidation. The bench found the appellant breached consent terms by deviating from agreed conditions without court sanction. The appeal was dismissed, upholding the lower court's order to seek fresh valuation from resale.

What did the court decide?

The appeal was dismissed in limine with costs, and the notice of motion was disposed of as infructuous.

Protochem Laboratories Pvt. Ltd. Vs Official Liquidator… — Company and Corporate | Bombay HC (2007)

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 IN THE HIGH COURT OF JUDICATURE AT BOMBAY

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 ORDINARY ORIGINAL CIVIL JURISDICTION

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 APPEAL NO.363 OF 2007
 ARISING FROM
 REPORT OF THE OFFICIAL LIQUIDATOR DATED
 4TH DECEMBER, 2006
 IN
 COMPANY PETITION NO.7 OF 1971

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 WITH

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 NOTICE OF MOTION NO.1970 OF 2007

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 Protochem Laboratories P.Ltd. .. Appellant

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Vs.

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 Esso Master Industries & Anr. .. Respondents

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 Mr.A.V.Anturkar, Sr.Advocate i/b Mr.B.B.Parekh for
 the appellant

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 Dr.A.K.Barthakur for the respondent nos.2 and 3

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 Mr.S.Ramakanth, Dy.Official Liquidator present

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 CORAM : J.N.PATEL &
 A.A.SAYED, JJ.

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DATED : 9TH AUGUST, 2007

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 P.C.:

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 1. Heard the learned counsel for the parties.

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 2. We propose to dispose of this Company

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 Appeal at the stage of admission itself.

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 3. The appellant is the proposed purchaser who
 has impugned the order dt.22.03.07 passed by the
 Company Judge on the Official Liquidator’s Report
 dated 15.11.95 filed in Company Petition No.7 of
 1971.

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 4. The matter pertains to liquidation of
 M/s.Glass Carboys & Pressed Wares Ltd (in Liqn.) &
 Others at the instance of Esso Master Industries.
 The respondents are the secured creditors.

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 5. During the pendency of the Company

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 Petition, the Official Liquidator filed a report
 dated 15.11.1995 for the approval of the Consent
 Terms entered into by the secured creditors and the
 purchaser. It is not disputed that the Consent
 Terms came to be accepted by the court by an order
 passed on 25.04.1996. In view of the fact that the
 Official Liquidator found that the parties having
 not acted upon the Consent Terms, he moved the
 court by filing Official Liquidator’s Report dated
 04.12.06 seeking directions from the Company Judge

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 as to whether the court would be pleased to direct

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 M.S.F.C. to get the revaluation of the property
 done from a Government approved valuer for resale
 of the same which led to the passing of the
 impugned order.

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 6. Mr.Anturkar, the learned Senior Advocate
 appearing for the appellant purchaser, as per the
 consent terms raised two-fold contentions.
 Firstly, that the Company Judge has not taken into
 consideration that the sanction of the sale by the
 court was mandatory and that the transaction was
 not completed, so as to obtain sanction of the
 court to dispose of the property in question.
 There was no effective order to show that there was
 approval granted by the court to the terms agreed
 between the parties as incorporated in the consent
 terms tendered before the Company Judge. Secondly,
 it is submitted that the appellant alone is not
 responsible for the delay in completing the
 transaction and the respondent / secured creditors
 have contributed to the same and that insofar as
 the appellant is concerned, it has always shown its
 willingness and bonafides by abiding to the terms

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 on which it has agreed to purchase the property and
 even had a draft prepared for the entire amount of
 the consideration.

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 7. On the other hand, it is contended that the
 learned Company Judge was justified in accepting
 the report of the Official Liquidator and passing
 the impugned order directing the property to be put
 for sale on obtaining fresh valuation of the
 property from a Government approved valuer on the
 panel of the liquidator.

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 8. The learned counsel for the parties drew
 our attention to the various correspondence which
 has taken place between the parties in respect of
 the transaction in question to substantiate their
 rival contentions.

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 9. On going through the record and the impugned
 order, what we find is that once the parties accept
 that they had agreed to dispose of the property in
 question in accordance with the consent terms
 arrived between the parties and having submitted it
 to the court for its approval through its official

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 liquidator and the court having approved the
 consent terms on 25.04.96, it suffices’ to say that
 the court has sanctioned the sale of the property
 in question in accordance with the consent terms.
 The appellant cannot be heard on the issue that the
 sale has not received the approval or sanction from
 the court. The next thing which we find is that
 the appellant has tried to deviate from the consent
 terms entered between the parties and the secured
 creditors who are the respondents without
 approaching the court in the matter, though such
 liberty was granted and delayed the transaction by
 trying to negotiate the terms and conditions and
 thereby committed breach of the terms and
 conditions on which court accorded sanction for
 sale of the property.

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 10. Nothing prevented the appellant from
 approaching the Company Judge if it was under
 certain misconception relating to the
 interpretation of the terms and conditions recorded
 in the consent terms or wanted the same to be
 changed or altered.

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 11. The correspondence clearly shows that the
 respondent secured creditors did not consent to any
 modification of the terms and conditions recorded
 in the consent terms. Therefore, in the facts and
 circumstances, we find that the learned Company
 Judge was justified in coming to the conclusion
 that the appellant has not complied with clause 3
 of the consent terms and even took into
 consideration the correspondence between the
 parties and found that in spite of opportunities
 being given by the secured creditors to the
 appellant, the appellant did not comply with its
 obligation under the consent terms and therefore,
 the secured creditors were justified in moving the
 Official Liquidator to seek further orders from the
 court in the matter of disposal of the property of
 the Company under the liquidation.

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 12. We do not find any error or illegality in
 the impugned order. The appeal stands dismissed
 with costs. In view of the fact that this court
 has dismissed the appeal in limine, the notice of
 motion taken out by the applicants does not
 survive. The same is also disposed of as

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 infructuous.

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 ( J.N. PATEL, J )

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 ( A.A. SAYED, J )

Protochem Laboratories Pvt. Ltd. v. Official Liquidator of M/S. Glass Carboys and Pressed Wares Ltd. (in Liqn) and 2 Ors.

Case brief

What is this about?

What did the court decide?

Protochem Laboratories Pvt. Ltd. v. Official Liquidator of M/S. Glass Carboys and Pressed Wares Ltd. (in Liqn) and 2 Ors.

Case brief

What is this about?

What did the court decide?

What the court decided

A compact analysis

Issues for consideration

Parties & counsel

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